SOURCE: Seven Stories Press

July 03, 2008 16:48 ET

Housing Expert and Former Goldman Sachs Banker Calls Current Financial Crisis a "Criminal" Enterprise on FOX News

NEW YORK, NY--(Marketwire - July 3, 2008) - John R. Talbott, best selling author of 2003's "The Coming Crash in the Housing Market" and his new book, "Obamanomics: How Bottom-Up Economic Prosperity Will Replace Trickle-Down Economics," said on FOX News today that the current housing, mortgage and banking crisis was a vast criminal enterprise.

Talbott said that realtors were pushing homes on people they couldn't afford solely to garner the commission, appraisors were inflating appraisals beyond reasonableness just to win business and mortgage brokers were altering applications to change stated incomes to justify too much lending to homebuyers.

More importantly, banks and investment banks were packaging and selling mortgages as high quality investments that they knew faced severe risk of default in a market downturn. The investment banks were paying supposedly independent rating agencies to provide AAA ratings to the packaged mortgages. And finally, the banks and investment banks were spending over $400 million annually in lobbying expenses and much more in campaign contributions to "bribe" our congressmen and president so that their illegal activities would continue unregulated and unenforced. Trillions of dollars of losses have resulted and the housing market is still only about halfway through its inevitable decline. Talbott sees home prices declining as much as 25% nationwide and more than 50% on the coasts and in Las Vegas and Phoenix.

About John R. Talbott:

A former investment banker for Goldman Sachs and Visiting Scholar at UCLA's Anderson School of Management, John R. Talbott is the author of five books on economics and politics, including the 2003 book "The Coming Crash in the Housing Market" and his February 2006 book, "Sell Now! The End of the Housing Bubble." Talbott's new book, "Obamanomics," out this week, assesses Barack Obama's plans to improve the economy. He has written for The Wall Street Journal, The Financial Times, and The Boston Globe, and appeared as a commentator on CNN, Fox, CNBC, and CBS.

Contact Information

  • For more information or to arrange an interview with John Talbott:

    Ruth Weiner
    Seven Stories Press